Yield is the income earned from an investment, most often in the form of interest or dividend payments. Yield is one of the ways in which investments can earn a trader money, with the other being the eventual closing of a position for profit.

Most often, yield will be expressed as a yearly percentage of either the value of the original investment, or of its current market value.

The two assets that are most commonly associated with yields are shares and bonds. Share yields are usually given as a percentage of the current share price of a company. That means that an investor who sees the value of their shares increase will see greater return on their investment if dividend levels remain constant.

Bond yields can be given as either a percentage of the bond price when it is issued, a percentage of the current price of the bond, or an estimate of what the bond’s yield will be if it is held to maturity.

With IG

A CFD position on a share that pays a dividend will see its price adjusted to reflect the dividend payment.

CFDs are a leveraged product and can result in losses that exceed deposits. You do not own or have any interest in the underlying asset. Please consider the Margin Trading Product Disclosure Statement (PDS) before entering into any CFD transaction with us.

The value of shares and ETFs bought through an IG share trading account can fall as well as rise, which could mean getting back less than you originally put in.

Please ensure you fully understand the risks and take care to manage your exposure.

IG does not issues advice, recommendations or opinion in relation to acquiring, holding or disposing of our products. IG is not a financial advisor and all services are provided on an execution only basis.

The information on this site is not directed at residents of the United States or any particular country outside Australia or New Zealand and is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.